With sixpence upgrades all over the place, second-hand e-tailers look up and see the moon of a new lifestyle.

At the beginning of the year, the second-hand e-commerce around the group continued to finance the news of second-hand trading this “long history” of the track has received a lot of attention, in June, the concept OF ESG (environment, society, governance) the first love recovery landing in New York Stock Exchange, onlookers realized that the leading war may be coming.

However, in the long term, the second-hand e-commerce marathon is still some distance from the end.

“Post-second-hand” era, China’s second-hand e-commerce competition

In the mainstream second-hand e-commerce platform, Love Recycling was founded in 2011, in 2015, backed by Taobao Idle fish officially launched, in 2016, 58 tongcheng’s second-hand channel upgraded to independent zhuan, and in 2020 merged with second-hand 3C products trading platform to find beautiful machine. In the past two years, more accurate and vertical platforms such as Huishubao, Tiejia Er Mobile, Hongbulin and Panghu Luxury have also gradually grown and gained financing and support.

In this process, traditional recycling counters and individual recycling households going from door to door gradually disappear, and middlemen begin to be replaced by platforms. With the development of e-commerce and logistics, the “post-second-hand” era is quietly coming.

The earliest platforms such as Airecycling, Zhuan and Xianyu are developing the fastest, and the formation of the model is also more rapid. The second-hand electric dealer market run To C end user demand for the finish, the idle fish back on taobao, C2B2C chain is forming rapidly, recycling all around and love in bilateral layout is trying To hit a new record, but the former is based on the To C C2B2C To extension, the latter is the starting point To B for business, the recycling products and sellers To do business, After the seller completes the follow-up business, smaller platforms are often still in the process of exploration and trial and error.

In terms of development level, the volume of Zhuan and Xianyu is currently in the first echelon, airecycling parent company all things new took the lead on the road of listing, the rest of the players will seek development in the game of this group of leaders.

According to the official data of Alibaba Group, Xianyu’s GMV in fiscal year 2020 exceeded 200 billion yuan, with more than 30 million sellers. According to Bidar data, in terms of monthly activity, The monthly MAU of Xianyu in March 2021 was 57,345,000, exceeding the sum of the following nine platforms. The business foundation of e-commerce made Xianyu far ahead.

But the latcomers also have their own bright spots, in addition to the successful listing of love recycling, landing on the secondary market, zhuan in the primary market heat rising, the amount of financing in the first half of this year exceeded 3.5 billion.

In addition to the huge scale of the second-hand e-commerce market itself, the core reason why the head platform can gain the favor of capital is that they have mastered the core competitiveness of the second-hand e-commerce market to a certain extent and try to achieve higher goals.

Who can conquer the three mountains first with two magic weapons?

The scale of idle fish can take the lead, a very important reason is that the category is the most complete — just a key taobao resale is a dimension reduction blow on the number of SKU.

However, this does not affect the upward growth of peers represented by Zhuan. Second-hand 3C products are in a leading position in the balance ranking of transaction activity and transaction unit price. Heads are heads because they both have two things: standardized processes and scale.

Standardization process is to reshape the rules of market circulation. In terms of the core transaction type represented by 3C, it roughly includes indicators such as inspection, classification and pricing. The difficulty lies in the non-standard of second-hand products, scratches and scratches may differ greatly, and battery loss may not be accurate. Even the more regulated used-car industry can’t guarantee a foolproof solution.

In this step, zhuan and Love recycling go faster than idle fish. For example, the whole process disclosed in the prospectus of love recycling only takes about 3 days, while the industry average is about 10 days. The multiple categories of Xianyu put forward higher requirements for the reshaping of the whole process. On the platform with its own C2C background, Xianyu Youping has to compete with users for business.

Another point is the scale effect. The reduction of marginal cost creates prospects for profits, mainly from the improvement of performance efficiency in the process. For example, logistics in the transshipment process, the more the number of one-time delivery, the lower the cost of dilution.

Take Zao as an example, since March, the group’s DAILY C2B recycling volume has reached 15,000 units, the pre-warehouse of B2C business covers 85% of the country’s cities, and in May, the group’s monthly activity has exceeded 50 million, the overall scale has been stable in the first echelon, scale running, cost control will come naturally.

However, the platform needs to be more vigilant is that there are three mountains in the second-hand e-commerce industry, traffic, trust and stickiness.

Second-hand electric developers lack of continuous traffic sources, the characteristics of the main reason lies in the second-hand deal – it is a typical precision demand but it is hard to continue business, buying and selling second-hand for ordinary users is always at a specific time of specific needs, so the second-hand electric business facing users out of the embarrassing, platform becomes a tool type products.

So the platform each has a strange move, idle fish use Taobao to dig potential; Turn back on Tencent, obtained a position of wechat “Nine grid”; After the merger of Aihuaxuan and JINGdong Paipai, it has gained strong traffic support, and it is the first offline store.

The problem is that the growth, or the growth of second-hand transactions themselves, cannot keep up with the demands of platform growth.

Although the penetration rate of second-hand e-commerce has reached 23% in 2020, data from MobData Research Institute shows that China’s second-hand idle economic transaction volume has reached 1,254 billion yuan in the first half of 2020, but the annual transaction volume of second-hand e-commerce in 2020 is only 374.55 billion yuan — the rest of the volume goes offline. Consumers are more trusting of visible middlemen.

In the post-second-hand era, in addition to facing the fierce pursuit of peers, second-hand e-commerce companies should also be wary of the “old generation” represented by huaqiangbei recycling counter.

The nature of second-hand trading also raises the issue of stickiness, or platform loyalty. Traditional e-commerce giants are worried about the retention of second-hand e-commerce with what to solve?

At this point, the head platform represented by Xianyu can be said to be favored by virtue of its higher credibility, while the vertical category platform represented by Xianyu and Hongbulin can also catch the core group. However, competitors still exist, and the wind direction may change at any time from the initial price war to the later operation.

In the process of trading, the trust between people, platform and people needs to be continuously optimized. After all, as a transfer station, the platform can hardly have absolute binding force on the C-end. The good news is that the trend is still positive, as the proportion of C2C transactions filed for arbitration in 2020 was 0.38%, down 0.15% from 0.53% in 2019. If the platform cares, it’s easier for consumers to make choices.

Compared with the situation of “one super many strong” in China, the wind of foreign second-hand e-commerce companies blows into the capital market earlier. What ideas are worth learning from them?

As the SECOND-HAND e-commerce business in the US enters its harvest period, what should domestic platforms learn?

This year, Poshmark and ThredUp have both gone public and soared. In June, Etsy, a US e-commerce platform valued at more than $20 billion, bought Depop, a UK second-hand e-commerce platform, for $1.6 billion. TheRealReal, a platform focused on second-hand luxury goods, has already hit the market, and if China’s second-hand e-commerce is still struggling to grow, its US counterparts are already reaping the rewards.

From their experience, the two core points are respectively supply chain and social construction. Supply chain is the basis of business, and the story of social is the story of traffic and stickiness.

The construction degree of supply chain affects the delivery and performance, which is of great significance not only to the evaluation and re-use of users, but also to the final cost control. ThredUp, a second-hand clothing e-commerce company, has optimized the supply chain, integrated door-to-door pick-up, disinfection, classification and distribution processes, and optimized the construction of functional centers, especially distribution centers, through the C2B2C model to expand the profit space.

Piper Sandler, among others, rated the young reseller overweight, bullish on supply-chain optimization.

The integration of social and e-commerce is in line with the habits of the new generation of consumers, and is a natural source of traffic and stickiness builder.

One of the biggest reasons Why Depop is Etsy’s favorite is that it’s an Instagram/eBay hybrid that has a large audience for Gen Z, the next generation of consumers Etsy values, who have both the spending power and the desire to spend.

More than 90% of Depop’s 16 million users are under the age of 26, and its way of “buying” is through bloggers and Kols, which are socially driven and deeply tied to the community, giving a second-hand e-commerce platform an enviable dynamic.

In domestic platforms, only the “fishpond” function of Xianyu is closest to this model. However, since the platform has not formed a corresponding business model, it still stays at the information level, and the flood of bad information has been reported in Fishpond for several times. Therefore, there is still a lot of work to be done for domestic platforms on the social + e-commerce story.

conclusion

Compared with the more mature foreign second-hand e-commerce market, although domestic platforms have their own remarkable capabilities, how to thoroughly activate this field may need to be like used cars and second-hand houses in those days, let the operation wheel turn first, then know where there is a pit on the road.

Although foreign models are more mature, ThredUp’s sales are only $186 million in 2020, while Depop’s GMV is $500 million. For example, The GMV target for 2021 is $500 billion, and the business model has already been established, so how to cultivate value is the most important thing.

In the face of the complexity of the Chinese market, there may be no end in the course of second-hand e-commerce in a short time. Behind the countless SKUs, there is an infinite war of continuous evolution.

Article | U.S. stocks club (meigushe)